Monday, October 16, 2006

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"The internal split within Umno will weaken the party’s position and this will pave way for the Chinese Malaysians to make various demands to benefit their community," Khairy was quoted as saying by Chinese newspaper Sin Chew Daily.

"The MCA ministers who have submitted a memorandum to Prime Minister (Abdullah Ahmad Badawi) earlier this year to demand for Chinese community’s rights was the result of Umno being in a weak position," the report added.

Khairy also argued that Umno woes have created a similar situation as in 1999 - when the Malaysian Chinese Election Appeals Committee (Suqiu) made a set of "demands" when Umno was divided following a fallout between then prime minister Dr Mahathir Mohamad and his deputy, Anwar Ibrahim.

The embattled Umno Youth No 2 told party members that while they could not blame MCA and Gerakan for making such demands, it was a weak Umno which opened up the opportunities for the two parties, both partners of the ruling coalition, to advance their interests.

Chamber defends call to scrap 30% quota in Penang for housingRegina William and Opalyn Mok

PENANG: Penang Chinese Chamber of Commerce (PCCC) president Datuk Khor Teng Tong today (Oct 5, 2006) defended the chamber's call for the 30% bumiputra quota for housing and commercial projects in Penang to be abolished, saying the call was purely business in nature and not politically motivated.

The chamber has come under fire from Penang Umno Youth for suggesting that the quota requirement should not be included in the draft of the Penang Structure Plan (2005-2020) which has been on display for public viewing as it made it difficult for developers to carry out their businesses, due to non-takers for the allocated units.

Umno Youth had accused the PCCC of "playing with fire" saying it was against efforts by the state government to raise the economic standards of Malays in the state..

On Tuesday (Oct 3, 2006), Khor had said if implemented as stated in the draft plan, it would be too rigid and pose more problems for developers.

"I am a businessman and my main concern is about business. I am not even politically motivated and so the stand of the PCCC should not be seen in a political light but solely from the business standpoint.

"This clearly cannot be exercised in Penang as it is very difficult to sell even five per cent of units to bumiputras, especially in areas like George Town.

"If this is enforced, then developers will be saddled with the 25% of the bumiputra units, without being able to sell them.

"There are 1,000 ways to help bumiputras in the state, but this is definitely not one of them as it would cause great hardship to developers," said Khor, who is the group executive chairman of Hunza Properties Berhad, a major developer in the state.

"The quota is practical to be implemented in states like Kelantan, Terengganu, Pahang, Perlis or even Kedah where the majority are Malays, but not in a state like Penang where the majority are Chinese," Khor added.

He said the current practice was if the bumiputra units are unsold, developers could sell them to non-bumiputras after six months, but only after receiving approval from the relevant authorities."

"I am talking about practicality and nothing else," he told theSun in a telephone interview.

Meanwhile, Penang DAP called on Bukit Mertajam Umno head Musa Sheikh Fadzir to retract his claim that Malaysia is the Malays' land.

Musa in warning off Khor and the PCCC, had said that "the Chinese who are rich and successful in business had rights before but this is our (Malay) land, our rights, our constitution".

"This is a multiracial country and his statement may bring about disharmony among other races," Chow said, adding that if Musa did not retract his statement within 48 hours, the DAP will lodge a police report against him.

PETALING JAYA (Oct 11, 2006): The research director of the Asli report which concluded that bumiputra corporate equity ownership was much higher than what government statistics showed has resigned after the think tank distanced itself from the findings.

Dr Lim Teck Ghee, director of Asli's Centre for Public Policy Studies, said he stood by the report which stated that bumiputra corporate equity ownership could be as high as 45% and not 18.9% as stated in government statistics.

The resignation came a day after Mirzan Mahathir, the president of Asli or the Asian Strategy and Leadership Institute, issued a statement that the report - Corporate Equity Distribution: Past Trends and Future Policy - was flawed in its methodology and assumptions, and its conclusions could not be "vigorously justified".

"Since I cannot agree with Mirzan's statement, and because of the need to defend the position and integrity of independent and non-partisan scholarship, I regret to inform that I will be stepping down from my position as director at the end of the month," Lim said in a media statement today.

He said as the centre's director, he bore full responsibility for the study, and stood by its findings, and the findings of the other studies the centre submitted to the government in February on the Ninth Malaysia Plan (9MP)

"I hope the public space opened up by the centre's work on this particular issue, as well as other important issues, will be expanded on and vigorously defended by others.

"It is the fundamental right of the Malaysian public to question all government statistics and policies, more so when these are not transparent or defensible," said Lim, a former United Nations regional adviser and World Bank senior political scientist, and the recipient of many international academic awards.

The corporate equity report was part of a bigger report the centre worked on called Proposals for the Ninth Malaysia Plan (9MP) which was submitted to government.

The centre's report had concluded that the National Economic Policy (NEP) target of 30% bumiputra equity ownership had already been exceeded, and said the official methodology inherited from the 1970s to measure corporate equity distribution was "narrowly-based" and "unrealistic".

According to the 9MP, bumiputra equity ownership in 2004, as measured by the Economic Planning Unit (EPU), stood at 18.9%.

The Asli centre report also said it was clear that "selective patronage" had resulted in "serious intra-ethnic Malay cleavages", and the continued promotion of the NEP would only increase antagonisms among bumiputras that some are more favoured than others.

The centre did not receive any feedback from government until the corporate equity chapter was widely reported on a few weeks ago.

Since then, Umno vice-president Tan Sri Muhyiddin Yassin has described the report as "rubbish" and challenging the government's authority, following Prime Minister Datuk Seri Abdullah Ahmad Badawi's statement that the report was "baseless", "inaccurate" and "irresponsible".

On Monday (Oct 9, 2006), Utusan Malaysia also quoted former premier Tun Dr Mahathir Mohamad as saying the centre's findings were "illogical" because bumiputra economic control was far below that of other races.

Mirzan was also quoted in the same paper on Wednesday as saying the report's quality did not reflect Asli's expectation, and had undermined the institute's reputation and diverted attention from its other positive recommendations.

He was also quoted as proposing that an editorial board be set up to vet the quality of future Asli research so that its work would not be undermined.

Contacted by theSun on Wednesday night, Mirzan denied that he issued the statement on Tuesday due to political pressure

“My concern is the good name of Asli. Obviously, I need to correct the misconception of people about Asli,” he said, adding that it was his responsibility as Asli president to protect its reputation.

Asked about speculation that the statement was solely his and did not reflect the views of other Asli directors, he said: “We should not jump to any conclusion. I issued the statement as president. So my statement would be Asli’s statement.”

On Lim’s resignation, he said: “If he disagreed with the centre and if he feels very strongly about it, he’s free to do it (resign). We wish him well in the future.”

Asli CEO Datuk Dr Michael Yeoh said he respected Lim's decision to resign, adding that he stood by Mirzan's statement.

Asli director Tan Sri Ramon Navaratnam said Lim's resignation was unfortunate. "I hope it does not send out the wrong signal to others who want to undertake honest and sincere research on the challenges facing Malaysia," he told theSun.

Opposition Leader Lim Kit Siang said Mirzan had failed to explain how the centre's methodology was flawed, and how the Economic Planning Unit's methodology was valid.

On criticisms of the report, he said: "It is a triumph of brawn over brain and a major setback towards creating a 'first class mentality'."

The DAP adviser called on Abdullah to direct the EPU to make public the methodology it had used to measure corporate equity ownership in the interest of openness, accountability and transparency.

An interview with Dr Lim Teck Ghee

The Centre for Public Policy Studies was set up under Asli in September last year (2005). It has its own research associates but draws on a wide circle of academics nationally and internationally.

It's first project was to work on a report called Proposals for the Ninth Malaysia Plan (9MP) which was submitted to the government in February for consideration before the 9MP was unveiled.

The report focused on five main areas that the centre thought were priority areas - the civil service, educational reform, the plight of the low income communities, the plight of our Malaysian marginalised communities living in the forest focusing on the Penan, and corporate equity.

Although the report was widely circulated, the centre did not get feedback until the corporate equity issue - under the chapter known as "Corporate Equity: Past Trends and Future Policy" - was reported in the media.

In an interview in his office on Oct 4, 2006, head of the centre Dr Lim Teck Ghee said although reforming the civil service was far more crucial for the centre than the corporate equity ownership issue, the latter was still an important issue.

"It's one which, if you talk to investors, bankers, people in the economic spheres, you will hear a great deal of concern about it. So, this is not an academic issue. It's an issue which has been articulated by many quarters for a long time, since this target (30% bumiputra equity ownership) was set," he said.

"And what we did in our study was we focused on new data, new methodologies and we've arrived at a number of findings which we thought would be of interest to policy makers."

Excerpts of the interview ...

theSun: Were you surprised at the kinds of criticisms that were levelled at the report?

Yes, I was. I must say that first of all, we were not expecting the furore. Ours was an objective academic study. We undertook the study with the best of intentions. We are not the cat's paw of any interest or group.

The centre is an independent, non-racial, non-partisan body. We stand by our findings and we stand by the methodology that we used. We would be happy to engage in a discussion, a technical discussion on the issues of methodology and definitions, and our view that the (present) methodology used by the government is narrow, is outmoded, and is not realistic. And we'll be happy to sit down with scholars and technicians to discuss this.

Is this centre the first organisation to actually put up a view like that, that the methodology used by government is outmoded and too limited?

I think individual scholars in the past have alluded to this. But, to my knowledge, our centre is the first body, think tank, research organisation to work on this issue.

Were you surprised at all by the findings after the report was completed, that the (bumiputra) corporate equity (ownership) could be as high as 45%?

Well, yes and no. I must say that, we thought that the government figure of 18.9% was underestimated, but we didn't expect to find, using our definitions, that high an achievement.

And I must say that this high achievement shows that the government has been successful in redistributing wealth as defined by equity. So, it's something that the government should be proud of, and it's a finding which shared with the rest of the country, can allay some of the concerns and insecurities (of some groups).

So, we're a little surprised that our critics have accused us of having a particular agenda. The only agenda that we have is that of a non-partisan analysis of scholarly inputs into policy-making.

(We're saying that) in terms of the corporate equity share objective, that very specific target - using our methodology - has been achieved.

By the NEP (New Economic Policy)?

The corporate equity share target has been achieved. We're not saying that the NEP, you know, in all its fullest ramifications has been achieved. But in terms of the corporate equity share, it has, to my mind, reached its target and been successful.

But, quite apart from that, the point that I'd like to stress is that, in no other country in the world, has a marginalised community such as the Malays come up so quickly and attain this position of, economic and social and political, I wouldn't use the word "dominance", but success. Amongst all the countries in the world, the rise of the Malay middle-class and upper-class has been unrivalled.

But at the same time, the poor Malays continue to be poor?

There are many poor Malays and they continue to be poor. And we should prioritise this issue but continuing with the system of corporate equity distribution doesn't help the poor Malays. Giving places in the elite schools, scholarships to middle-class and upper-class, the children of middle-class and upper-class Malays who have benefited from the NEP does not help the poor Malays.

So, what the centre is advocating, and we're not the only ones, is that we need to change our strategy of development which is race-based to one which is race-neutral and more class-based.

What about the criticisms that you shouldn't be using GLCs (government-linked companies) as part of the calculation of corporate equity ownership?

You know, if you want to go into the calculation of it, if you take out the GLCs, like they said. If you take the Malay share of it, of companies, limited companies, and if you add in the Malay part of the nominee, it's 18.9% plus another four or five already. So, you're bringing it up to about 23% or 24%.

And also that doesn't take into account the foreign part of it which may have Malay proxy shares - Malay ownership using foreigners as proxy.

But, perhaps we don't need to get into the details of it (here). We're more than happy to have an open discussion about methodology with anyone.

What kinds of feedback were you hoping for that you thought might be constructive in terms of using this report more effectively?

Well, we were hoping that, as we indicated in the report, our database is, has been limited and we hoped that there would be fuller access to data provided by the authorities. We hoped that the authorities when they undertake their work will come out with a fuller, if not complete, explanation of how their statistics are derived.

We think that this kind of exchange would be more important. There's also the issue of the impact of the bumiputra quota of 30%. Now, there has been very little said in the official reporting on this, but there's very clear evidence that this 30% or more has accrued in the hands of a very small group.

So, we hope that the discussion can be widened into the areas of how to ensure that equity wealth, for example, can be more widely shared with a much larger circle of Malaysians. We hope that the issue of rent-seeking and market distortions which have come about as a result of this ruling can be dealt with. In other words, we welcome a full discussion of all the complex dimensions of this issue from technical, to social to political.

Encik Mirzan Mahathir, President of ASLI, yesterday issued a press statement on the study conducted by the CPPS on "Corporate Equity: Past Trends and Future Policy". The ASLI statement was in response to various comments arising from the study's finding on the level of Bumiputera equity ownership. As Director of the CPPS, I take full responsibility, and stand by the findings of the study and the other studies that were submitted in our report to the Government on the 9th Malaysia Plan in February 2006.

Since I cannot agree with Encik Mirzan's statement, and because of the need to defend the position and integrity of independent and non-partisan scholarship, I regret to inform that I will be stepping down from my position as Director at the end of the month.

I hope the public space opened up by the Centre's work on this particular, as well as other important, issues will be expanded on and vigorously defended by others. It is the fundamental right of the Malaysian public to question all government statistics and policies, more so when these are not transparent or defensible.

I would like to thank ASLI for giving me the opportunity to work with it in providing service to the country.

[ “The Malays will feel they are not getting enough; the Chinese will feel they are sacrificing too much and have been kept away from economic activities; and the Indians will feel they all have nothing". - lim keng yek... ]

Perceptions vary over same issue, says Keng Yaik

KUALA LUMPUR: The recent controversy regarding the bumiputra stake in the economy is an example of a Chinese proverb of an issue being seen from different perspectives, said Gerakan president Datuk Seri Lim Keng Yaik.

He said the proverb is: Same bed, different dreams.

“It’s like two people sleeping in the same bed but having different dreams. Some are actual dreams and some are nightmares.”

He was speaking to reporters after chairing a three-hour discussion here yesterday over the findings of the Centre for Public Policy Studies of the Asian Strategy and Leadership Institute (Asli).

The study estimated that bumiputra equity ownership in public-listed companies could be as high as 45%.

On Tuesday, Asli president Mirzan Mahathir said the study was based on faulty assumptions. The centre’s director Dr Lim Teck Ghee, stood by the findings and resigned in protest.

Keng Yaik said the issue had affected people's perception of the Government's integrity.

He called on the Government, through the Economic Planning Unit, to make known its own findings on the issue so as to uphold the Government's integrity.

“Whether it’s 18.9% or 45%, it doesn’t matter. We want the true picture out in the open.

“Let’s not hide behind official statistics. These statistics should be made known to the people,” added Keng Yaik, who is also Water, Energy and Communications Minister.

Keng Yaik said the controversy had sparked off debates, with the different communities having their own perceptions of the issue.

“The Malays will feel they are not getting enough; the Chinese will feel they are sacrificing too much and have been kept away from economic activities; and the Indians will feel they all have nothing.

“The kind of feelings and perceptions are not good for the country,” he said.

Saying he was not referring to anyone in particular, including Gerakan president Datuk Seri Dr Lim Keng Yaik, Abdullah said his advice was to all people.

Speaking to reporters at RMAF Subang upon his return from Mecca after performing his umrah, he said the government could not stop the people from asking questions, but they must be asked properly and correctly.

"The govt is always transparent and willing to answer any questions that are raised by the people concerning matters related to the government, but please, ask properly."

Meanwhile, it is learnt that the cabinet at its weekly on Wednesday (Oct 18, 2006) will be discussing at length the methodology used by the Economic Planning Unit (EPU) to calculate the corporate equity of the Malays, as it was also being questioned by the Barisan Nasional component parties.

According to sources, the Finance Ministry, EPU and the International Trade and Industry Ministry, have been told to prepare their respective reports, which will be presented to Cabinet before a final decision is made whether the make the methodology used would be made public since many people are sceptical.

The source said the EPU, is ready to make their methodolgy public in its website if the Prime Minister, who is also the Finance Minister gives the green light.

Yesterday, Deputy Prime Minister Datuk Seri Najib Abdul Razak said the government was willing to make public the methodology used by the EPU to calculate the corporate equity ownership of various community.

"If there are still doubts (on the figures), we can reveal the methodology used and the government was transparent when it comes to such economic data.

"We have no problem revealing the methodology but there should be no insinuation as if the government is not being transparent," he said.

Doubts over the government's data were raised after a study by Asli's Centre for Public Policy Studies(CPPS) concluded that bumiputra equity ownership could be as high as 45%, compared with EPU's 18.9% figure.

The centre came under attack from Umno leaders and Malay groups. Following that, Asli president Mirzan Mahathir admitted that its methodolgy was "flawed" last Tuesday (Oct 10, 2006).

The following day, CPPS director Dr Lim Teck Ghee stood by his report and resigned.

NEAC the best platform?

KUALA LUMPUR (Oct 16, 2006): The National Economic Action Council (NEAC) should be the best platform for the government and the parties concerned to sit down to talk about the bumiputra equity ownership issue, former deputy prime minister Tun Musa Hitam said today.

He said the government should invite all the parties concerned, not only Asli but other think-tank groups as well, to sit down and exchange views in the NEAC which already consists of various groups.

'The NEAC has been a useful forum for discussions out of the limelight. The issue must be dealt out of the limelight. Otherwise it will be blown out of proportion," he said.

Speaking to reporters after delivering a keynote address at the Asean Civil Society Conference - Malaysia Process National Consultation on Asean Charter organised by Suaram and South East Asian Committee for Advocacy (Seaca), Musa said if not the NEAC, a special session to discuss the matter should be held by the government to iron out its differences with various parties.

The NEAC was established on Jan 7, 1998, as a consultative body to deal with the immediate issues to tackle the 1997 Asian financial crisis.

Musa, who is also a former Suhakam chairman, stressed the importance for the issue to be discussed out of the limelight, in view of the current mood in the country.

"There are so many predators looking for to grab issues that could turn something into emotional (issues). Emotional in racial terms need to be managed with care," he said.

Citing the upcoming Umno general assembly next month (November 2006) and groups in the party "which are willing to weaken the current leadership", he warned that the issue could be used to meet political ends of some 'political opportunists'.

"They are too many political opportunists who are ready to grab the issue and irrationalise them, and exploit them for their own political ends," he said.

The dispute on the bumiputra corporate equity was sparked after a report by Asli concluded that the bumiputra corporate equity could be as high as 45% was widely reported in the media.

The official bumiputra corporate equity revealed under the Ninth Malaysia Plan (9MP) was 18.9%.

Musa said Asli or those who differ in their findings on the corporate equity should engage the government in discussion as well.

"The Asli report had been meant to be read many many months ago when it was submitted to the government," he said.

"I thought the government could look at the paper from the perspective of a paper analysis, and that it didn't need to reach a level of controversy."

SUBANG, Oct 16 (Bernama) -- Datuk Seri Abdullah Ahmad Badawi said Monday all parties should not cause trouble but should seek clarification properly if they are unhappy with certain things.

The prime minister said the government would have no problem explaining the methodology used in measuring bumiputera equity holding in the country if that was disputed.

"Don't insinuate. Why make insinuations? Insinuations, accusations bring no benefits. If one seeks an explanation, ask properly. Why seek explanation by insinuation? Why seek explanation by making accusations? That's not the way to go about it," he told reporters on his return from performing umrah.

On hand to welcome him at the Royal Malaysian Air Force base here was Deputy Prime Minister Datuk Seri Najib Tun Razak.

Abdullah was commenting on a call by Gerakan to the Economic Planning Unit to disclose the methodology used to show that the bumiputeras' share in the country's economic pie was only 18.9 per cent.

Gerakan president Datuk Seri Dr Lim Keng Yaik had said that something was not right with the figure because it had not shown any improvement since the New Economic Policy was introduced in 1970.

Abdullah said his remark was not targeted at anyone but was a general statement to all parties including the Malays not to try to cause trouble.

He said that if there was a problem it should be discussed amiably to resolve it.

"If the intention is to cause a disturbance, see what will happen. If one wants to ask something, do it properly," he said.

On the equity position of bumiputras that was still low, the prime minister said many Malay entrepreneurs were adversely affected during the last economic crisis that hit the country.

"During the economic crisis, the financial crisis, many were badly hit; many businesses and many Malay entrepreneurs had to close shop, many of those affected had piled up their debts so much so that they could not repay.

"That actually affected our position ... I hoped that the situation would keep on improving but that was not the case. Each time there was an economic crisis or economic recession, it had an impact (on the bumiputra equity)," he said.

Abdullah said the government had long-term plans and during that period various things could take place, adding that the increase in fuel prices had an adverse impact on the current efforts of the government.

He said it was important for all quarters to face all these (problems) and strive to overcome them.

Asked about the possibility of any group trying to take advantage of the open policy adopted by the government under his leadership, the prime minister said people would always attempt to take advantage.

"People will take advantage whenever they can ... they will do so with an open policy, when restricted they will want to challenge demanding why (the policy) was restrictive, why there was no transparency today, why there was no freedom ... they will take advantage.

"Those who want to cause trouble will take advantage (of the situation). When we are open, the trouble-makers take advantage ... it is the attitude of people to take advantage," he said.

Asked whether his statement was a warning to the group involved, Abdullah said: "To whoever it is, whoever the case may be, Malays or non-Malays, do not cause trouble; if one wants to ask properly, do so properly.

"If people do good once, we can do so 10 times over. Once you do something bad, be careful ...'.

"The internal split within Umno will weaken the party’s position and this will pave way for the Chinese Malaysians to make various demands to benefit their community," Khairy was quoted as saying by Chinese newspaper Sin Chew Daily.

"The MCA ministers who have submitted a memorandum to Prime Minister (Abdullah Ahmad Badawi) earlier this year to demand for Chinese community’s rights was the result of Umno being in a weak position," the report added.

Khairy also argued that Umno woes have created a similar situation as in 1999 - when the Malaysian Chinese Election Appeals Committee (Suqiu) made a set of "demands" when Umno was divided following a fallout between then prime minister Dr Mahathir Mohamad and his deputy, Anwar Ibrahim.

The embattled Umno Youth No 2 told party members that while they could not blame MCA and Gerakan for making such demands, it was a weak Umno which opened up the opportunities for the two parties, both partners of the ruling coalition, to advance their interests.